My media centre for the past 7 years has been a Mac Mini with an external hard disk. I've been playing music through iTunes and either watching movies from DVDs I've ripped to the hard-drive, or renting movies from iTunes. I've decided that this setup is antediluvian.
I am slowly moving to a media setup for the 21st century. I've decided that everything needs to be stored on the cloud. No local storage. This means I use Spotify for music and Netflix for movies/tv. I also don't want to have to go over to a computer in order to search for movies or music. I want to be able to search for media on my iPad and stream it to the TV/stereo.
In order to accomplish this, I've bought an Apple TV. This is connected to my TV via HDMI, and will shortly be connected to my stereo (once the Optical Digital to Stereo converter arrives). I set it up last night, and everything seems to be working well.